How Cyrus Mistry was sacked

Ratan Tata offered Cyrus Mistry a choice to remain on the Tata Sons board as a non-executive director on the day he was removed as its chairman, according to Mistry’s petition to the National Company Law Tribunal.

Mistry, whose family owns an 18.5% stake in the Tata Group holding company, said he would continue on the board.

To a question by director Ishaat Hussain at the October 24 board meeting about his remaining as the chairman of other Tata companies, Mistry said he would decide on it and inform the board, even as Ratan Tata said the decision, to a great extent, would be Mistry’s prerogative, the petition says.

A Tata Sons official said there were three requests made to Cyrus Mistry to step down from the board before he was replaced on October 24.

The petition accuses Tata Sons and its board, including interim chairman Ratan Tata, of oppressing the interests of minority shareholders and mismanagement.

The first hearing of it is scheduled for Thursday. “Ratan had mentioned that they need to recognise the work done by Mistry in the last four years and it was important for the group to move forward in as seamless manner as one can,” the petition says.

According to the minutes filed of the board meeting, Mistry was informed before the meeting that Ratan Tata would join them. Nitin Nohria, the Harvard Business School dean who is one of the directors, said Tata Trusts had asked their nominees to bring a motion to the board. The Trusts hold two-thirds of Tata Sons.

At the meeting, Amit Chandra said a meeting of Tata Trusts on the same day had resolved that Mistry should step down. The reason given was that the Trusts had lost confidence in him for a variety of reasons.